Method and apparatus for mapping sources and uses of consumer funds

ABSTRACT

A bill-paying system includes a customer deposit account which receives periodic payroll deposits of an individual or a couple. A bill-paying service enrolls the individual or couple for a fee, and is authorized to transfer money from the deposit account to the accounts of various creditors. An originating depository financial institution, such as a bank, actually handles all the transfers of money, and such transfers are preferably all done electronically. The automated clearing house (ACH) network supports such electronic money transfers. The various bills and debts of the individual or couple come due at times that are asynchronous to their income structure. The bill-paying service is authorized to debit the deposit account for more than the basic minimums due all the creditors each month. Such excess is used to accelerate the repayment of various loans and debts according to what particular application at that time will have the greatest long-term beneficial effect.

BACKGROUND OF THE INVENTION

[0001] 1. Technical Field

[0002] The present invention relates to plans for repaying mortgageloans and other installment debts on accelerated schedules, and moreparticularly to computer-implemented systems that organize, forward, andreport the application of many individual consumer payments to theircorresponding lenders and creditors with the objective of saving moneyover a standard installment repayment history.

[0003] 2. Description Of The Prior Art

[0004] In general, the unpaid principle of a mortgage or other type ofloan is what earns interest for a lender at the agreed rate. Eachmonthly mortgage installment payment is usually applied first againstthe interest earned, and then any balance goes towards reducing theoutstanding unpaid principle. The actual amount that goes towardsreducing the principle can be relatively small, e.g., 10% of thepayment. So it makes sense that if the borrower can make the payments alittle more frequent than once a month or include more than the basicmonthly payment, the principle will be reduced faster and the interestearned will be correspondingly reduced. For example, biweekly paymentsof half the monthly mortgage amount will result in 26-biweekly paymentsbeing made in a year. So paying biweekly results in one extra wholemonth's payment being accumulated each year. That alone could reduce theterm of a 30-year mortgage by a couple of years and several thousanddollars being saved over the standard monthly payment schedule.

[0005] Commerce has always depended on the flow of value, i.e.,companies and individuals paying what they owe and collecting whatthey've earned. The conduit for the flow of value is the payments systemwhich has progressed from barter, to coins, to paper currencies, tochecks, and lately to electronic payments. In decades past, cash andchecks were the preferred payment calculators for consumers andbusinesses. Today, businesses, government agencies, and consumers feelthe burden of paper overload as more than sixty-three billion checks areprocessed every year. Each check must be written or printed, signed andmailed, and then retrieved, reconciled, and stored. With increasingincidents of check fraud and a strong emphasis on privacy, traditionalcheck-issuers are demanding more secure and confidential alternativesprovided by electronic payments.

[0006] Direct deposit is the automatic deposit of all or part ofemployees' pay, retirees' pension and annuities, and other businessdeposits to consumers' checking and/or savings accounts. Instead ofprinting checks, the employer or benefactor (originator) supplies acomputer file containing a record for each participatingemployee/retiree/consumer to the businesses financial institution (theODFI). The ODFI assures correct formatting and transmits the file to theautomatic clearing house (ACH) operator for delivery to theemployees'/retirees'/consumers' (receivers') depository accounts attheir financial institutions (RDFI's).

[0007] In the case of direct deposit of payroll, the employer providesthe employee on payday information regarding gross pay, payrolldeductions, tax withholding, net pay, and other appropriate details.Similarly, businesses supply other appropriate data to pensioners,annuitants, and consumers regarding the credits to their depositoryaccounts. Direct payment and home banking/bill payment services saveconsumers time and money by eliminating checks, check handling, andpostage. With direct payment, consumers preauthorize electronic debitsto their depository accounts for types of recurring bill payments suchas insurance premiums, utility bills, all types of loan payments,mortgages, club memberships, subscriptions, and charitablecontributions. To initiate direct payment, consumers must provide awritten authorization to their participating billing companies, clubs,charities, etc. Authorizations may be cancelled at the discretion of theconsumer according to the procedures outlined in the authorization.Cancellation of direct payment has no effect on the consumers' financialobligation to the billing company. With appropriate authorization, thebilling company originates a computer file containing paymentinformation. The company's financial institution transmits the debitthrough the ACH-network to the consumer's depository account.

[0008] When consumers choose to participate in conventional homebanking/bill payment services, they can initiate their bill payments bytelephone, computer, or other calculatorss. The consumer's serviceprovider initiates ACH debits from the consumer's bank account and ACHcredits to the consumers billing account for the authorized payment.Home banking/bill payment services are offered by various financialinstitutions and other private service providers throughout the UnitedStates.

[0009] Direct payment and home banking services provide benefits to bothcompanies and consumers. Companies reduce expenses associated with checkprocessing and improve cash flows by reducing delinquencies and latebilling procedures. Consumers reduce check and postage costs and savethe time of manually preparing and mailing checks. In addition,consumers can reduce late fees, forget about payment deadlines, and maketheir account reconciliation process simpler. Consumers never relinquishcontrol of their accounts. Direct payments and home banking/bill paymentservices may be terminated or modified at any time according toprocedures outlined in the authorization agreement.

[0010] Electronic commerce can incorporate all aspects of the ordering,inventory, and payments processes of businesses. Companies may useelectronic data interchange (EDI) to place orders; to update, control,and reorder inventories; to transmit billing statements; and to collector make payments. The ACH-network is an efficient electronic paymentalternative to checks and wire transfers to complement electroniccommerce. Electronic business payments may be ACH debits or ACH creditsdepending on the needs of and the agreements among trading partners. TheACH-network provides an electronic payments calculators for financialEDI, Internet payments, corporate trading partner exchanges, corporatecash management, and other business-to-business transactions such astransmission of insurance and healthcare information and payments.

[0011] Financial EDI is the electronic movement of payments andpayment-related information in standard formats through the bankingsystem. Businesses of all sizes; state, local, and federal governmentagencies, and financial institutions are incorporating financial EDIinto their payments practices to minimize the flow of paper, to reduceadministrative costs, and to improve efficiencies. Businesses use theACH-network to pay or to collect from corporate trading partners. Thetransaction sets of the ACH-network provide varying levels of paymenttransfers from the simplest to the most complex, including invoicenumbers, discount, adjustment, and other remittance information.

[0012] In the 1990s, the Internet is becoming an increasingly importanttool for business-to-business communications. Companies use the Internetto place orders, update inventories, and authorize payments. TheACH-network provides an efficient payments calculator to settletransactions initiated on the Internet.

[0013] Good corporate cash management techniques allow businesses toaccelerate cash in-flows, manage account balances to reduce borrowingneeds, improve earnings potential of operating capital, and preciselycontrol cash disbursements. The ACH-network allows companies to movemoney between branches or offices quickly and reliably based onoperating needs. Companies with geographically dispersed offices can usethe ACH-network to draw funds into centralized accounts fromwidely-scattered financial institutions. Similarly, funds can bedisbursed to remote operations as needed. The ACH-network is anefficient calculator to shift balances to and from centralizedconcentration accounts to effectively administer corporate operations.

SUMMARY OF THE INVENTION

[0014] The present invention includes a bill-paying system with acustomer deposit account that receives periodic payroll deposits of anindividual or a couple (“Subscriber”). A bill-paying service enrolls theindividual or couple for a fee, and is authorized to transfer money fromthe deposit account to the accounts of various creditors. An originatingdepository financial institution, such as a bank, actually handles allthe transfers of money, and such transfers are preferably all doneelectronically. The automated clearing house (ACH) network supports suchelectronic money transfers. The various bills and debts of theindividual or couple come due at times that are asynchronous to theirincome structure. The bill-paying service is authorized to debit thedeposit account for more than the basic minimums due all the creditorseach month. Such excess is used to accelerate the repayment of variousloans and debts according to what particular application at that timewill have the greatest long-term beneficial effect.

[0015] Among the features of the preferred embodiment of the inventionare:

[0016] 1. Each subscriber may be associated with multiple transactionsinvolving the movement of money;

[0017] 2. A single subscription transaction table is provided whichcontains all data for moving money;

[0018] 3. A subscriber can have one physical loan with multiplerecurring payment records, i.e. there is a logical grouping ofdisbursements for a given instrument;

[0019] 4. A trust finder function provides a join across multiple tablesfor trust arrangement to map money movement; and

[0020] 5. A campaign product is provided for managing money based uponproduct type and destination of funds.

BRIEF DESCRIPTION OF THE DRAWINGS

[0021]FIG. 1 is functional block diagram of a loan servicing system;

[0022]FIG. 2 is a functional block diagram of a money management system;

[0023]FIG. 3 is a flowchart diagram of a service provider and sponsorlockbox process embodiment of the present invention;

[0024]FIG. 4 is a block diagram of a debt repayment system;

[0025]FIG. 5 is a block diagram of a debt repayment system according tothe invention;

[0026]FIG. 6 is a flowchart diagram of a create ACH-file processembodiment of the present invention;

[0027]FIG. 7 is a flowchart diagram of a second part of the createACH-file process of FIG. 6;

[0028]FIG. 8 is a flowchart diagram of a generate receipts/disbursementsprocess embodiment of the present invention;

[0029]FIG. 9 is a flowchart diagram of a second part of the generatereceipts/disbursements process of FIG. 8;

[0030]FIG. 10 is a flowchart diagram of a third part of the generatereceipts/disbursements process of FIG. 8; and

[0031]FIG. 11 is a flowchart diagram of a fourth part of the generatereceipts/disbursements process of FIG. 8.

DETAILED DESCRIPTION OF THE INVENTION

[0032]FIG. 1 represents a loan servicing system, and is referred toherein by the general reference numeral 100. A customer checking account102 sources a transfer of funds 103 to a bank 104. A credit 105 is madeto a custody account 106 that acts like a buffer. Money is stockpiled inthe custody account 106 from the customer checking account 102 inamounts and times that are dependent on a customers ability to earnincome. In effect, this is a front-end money-gathering subsystem. Aseries of partial payments are stored up over time.

[0033] A debit 107 is periodically made to issue a credit 108 to apayment clearing account 110. An advise 111 is returned to a servicingplatform 112. So a back-end mortgage servicing or legacy subsystem isprovided for posting payments, segregating and remitting funds,calculating interest, mortgage servicing, car loan type processing, etc.In an early development prototype system, the servicing platform 112 wasprovided by Computer Power, Inc., now a part of Alcatel. Acommunications link 113 allows a service provider 114 to direct theback-end mortgage servicing or legacy subsystem. Another communicationschannel 115 allows the service provider 114 to direct the front-endmoney-gathering subsystem. The servicing platform 112 was initiallyprovided with mortgage servicing software, but it was discovered thatthis could be greatly expanded to service more than just the mortgagesof a consumer. Many or all of the installment accounts could besimultaneously managed for many hundreds of customers. It is alsopossible for billers to present bills for the customer to pay that aredelivered to the service provider 114, e.g., bills that require paymentwithin ten days The custody account 106 would then be used by theservicing platform 112 to pay such “pay-on-demand” bills when previouslyauthorized.

[0034]FIG. 2 represents a money management system that is referred toherein by the general reference numeral 200. A source designated depositaccount (DDA) 202 belongs to a subscriber 204 and has money periodicallydeposited to it. For example, DDA 202 may be the joint account of ahusband and wife where the husband gets paid by his employer everyFriday and the wife by her employer every other Tuesday. Between them,the couple (subscriber 204) have various installment loans and creditcard debts that need to be paid on or before certain days of the monthand with minimum payments for each. For example, a monthly payment isdue to a sponsor mortgage lender 206. An originating depositoryfinancial institution (ODFI) 208, e.g., a bank, is authorized atinstructed times and amounts to debit the DDA 202. The couple holdingthe DDA 202 have authorized a payment service provider 210 to instructthat funds be withdrawn from this account to pay the various creditorson time and with at least the required minimum payments. A pre-arrangedpayment and deposit (PPD) in ACH-format is used by the payment serviceprovider 210. The peculiar income structure of the subscriber 204 ispreferably used to advantage by the payment service provider 210 to makeperiodic payments on the installment loans and credit card debts. Forsuch service, the subscriber 204 will pay the payment service provider210 a fee, e.g., per use, per moth, etc.

[0035] The subscriber 204 can benefit by paying more than the minimumsdue on each account and by paying a monthly installment account in parton a weekly or biweekly basis. They will benefit by a more rapiddecrease in the unpaid principle and therefore save on the interestcharges that accrue on that unpaid principle each month. At the sametime, it is imperative that there always be enough money on hand to payeach bill by its due date. So any acceleration of payments cannot leavethe system 200 short of funds to pay any bill that normally comes duelater in the month. The payment service provider 210 must therefore beinstructed which creditors are to be paid, the terms of the loansinvolved, the income structure of the subscriber 204, and the totalamounts authorized to be withdrawn at various times of the week, month,and year from DDA 202.

[0036] The movement of money in system 200 preferably uses the automatedclearing house (ACH) network in the United States which is a centralclearing facility that provides distribution and settlement ofelectronic financial transactions. ACH operators clear debits andcredits electronically, rather than through the physical movement ofchecks. There are four ACH operators in the United States, the FederalReserve System, Visanet ACH, new York ACH, and American ACH. The FederalReserve System alone clears about eighty percent of all ACHtransactions. Such ACH-network was formed in the early 1970's to providean efficient alternative using electronic and telecommunicationstechnology to replace paper check processing. The ACH system usesbatch-processing, store and forward operations. ACH payments are notprocessed individually. Originating depository financial institutions(ODFI's) submit ACH payment files to the ACH operators. The ACHoperators accumulate these files, sort them by destination, and transmitthem to receiving depository financial institutions (RDFI's) forapplication to customers' accounts at predetermined times throughout thebusiness day. The ACH system provides significant economies of scalecompared to individual wire transfers, and is faster and more accuratethan paper-check processing.

[0037] The ACH-network is a nationwide wholesale electronic payment andcollection system now used by hundreds of thousands businesses andfinancial institutions.

[0038] Technological advances implemented by the ACH operators allowtransactions to arrive at their destinations in a matter of hours.Entries are settled quickly, most often within one business day oforigination. The ACH-network delivers electronic payments quickly,safely, reliably, and conveniently to financial institutions for theircustomers.

[0039] The ACH-network is not used only for consumer transactions suchas direct deposit and direct payment, nor only for business-to-businesstransactions known as financial EDI. The ACH-network is also thesettlement calculator for home-banking payments, credit card clearings,electronic benefit transfers (EBT), point-of-sale (POS) and Internetpurchases, electronic check transmissions, and even automated tellermachine (ATM) transactions. The ACH system provides the basicinfrastructure for a wide variety of electronic payment applications.

[0040] The national automated clearing house association (NACHA) is anonprofit banking trade association that promulgates the rules andoperating guidelines for electronic payments, such as direct deposit,direct payment (preauthorized debits), financial EDI, electronicbenefits transfers, third-party bill payments, electronic checks, andInternet payments. NACHA represents thirty-five regional ACHassociations which have a total of more than 13,000 financialinstitution members. NACHA provides educational payments conferences, aswell as marketing collateral and technical publications. NACHA can beaccessed through the Internet at www.nacha.org.

[0041] An “ACH originator” is a company or other business entity thatcreates entries for introduction into the ACH-network. For example, anemployer produces credit entries to pay employees who have authorizeddirect deposit. A utility or other billing company produces debitentries from customers' financial institution accounts who haveauthorized direct payment for products and services. A business producesfinancial EDI transactions to pay or collect trading partnerobligations. ACH receivers are consumers, customers, employees, andother businesses who have authorized electronic payments by directdeposit, direct payment, or financial EDI to be applied against theirdepository accounts. An originating depository financial institution(ODFI) typically initiates and warrants electronic payments through theACH-network on behalf of its customers. A receiving depository financialinstitution (RDFI) provides depository account services to consumers,employees, and businesses and accepts electronic payments to thoseaccounts. The ACH-network transfers payments and related data throughcomputer and high-speed communications technology, e.g., the Internet.ACH-network services can be divided into five broad categories, (1)direct deposit services, (2) direct payment and home banking services,(3) electronic commerce, (4) electronic benefits transfers, and (5)electronic checking.

[0042] Returning now to FIG. 2, the system 200 further includes a manualreceipt 212 that can be accepted in addition to or instead of electronictransfer funds from DDA 202. Either way, a settlement account 214 iscredited with the money. A services fee account 216 is credited by adebit to the settlement account 214 and transferred to an operatingaccount 218 belonging to the payment service provider 210. An enrollmentfee account 220 is used to receive up-front subscription fees that maybe required for use of the payment service system 200 from thesubscriber 204. A commission fees account 222 is used to receivemiscellaneous fees that may be earned from the sponsor 206, the ODFI208, or others. All such enrollment fees, service fees, and commissionscontribute to the operating account of the service provider.

[0043] A number of earmarked custodial accounts 224 are credited withmoney debited from the settlement account 214 in the name of the clientsponsor 206, e.g., at the request of the service provider 210 usingACH-format PPD. Such money is collected to pay an FNMA, GNMA, FHA, etc.,mortgage loan, car loan, credit card debt, or other. Thus system 200 isbased on an asynchronous debiting based on the subscriber's payrollcycles and crediting based on the due dates of various obligations.Prior art systems are simply driven to debit and credit solely on thedue dates of the obligations.

[0044] Funds are then periodically withdrawn from the custodial accounts224, in one case, to a check disbursement settlement account 226 so thata series of paper checks 228 can be issued. In another case, funds areperiodically withdrawn from the custodial accounts 224 to an EFTdisbursement settlement account 230. The service provider 210 instigatesboth these kinds of transfers with PPD instructions in ACH-format. Afterall the required payments are made, a curtailment can be calculated. Anysurplus funds in the custodial accounts 224 will trigger a collection ofunpaid service fees (USF). This results in a transfer of USF fromcustodial accounts 224 to the service fees account 216 by PPD inACH-format. A corporate trade exchange (CTX) ACH-format is used totransfer funds from the EFT disbursement settlement account 230 to asponsor payment clearing account 232. This is handled by an EDI processinitiated by the service provider 210. Such CTX transfer can include BPRand ADX segments, for example. Payments are then ultimately transferredto a sponsor servicing system 234 from the sponsor payment clearingaccount 232. A standard lockbox layout format is used that is triggeredby the receipt of the CTX transactions.

[0045] A typical transaction flow between the sponsor 206 and theservice provider 210 includes a solicitation tape from the sponsor, newadditions from the service provider, refresh records from the sponsor,account status changes from the service provider, and account statuschanges from the sponsor. Sponsor-generated transactions can alsoinclude investor sales/transfers, service releases,payoffs/paid-in-fulls, foreclosures, bankruptcies, payment changes, anddelinquent payment information. Conversely, service-provider generatedtransactions can also include updated first payment dates, suspendedaccounts, terminated accounts, custodial account balances, next and lastwithdrawal information, reactivated accounts, and letter-writer queuerecords.

[0046]FIG. 3 represents a service provider and sponsor lockbox process300. A step 302 begins with ACH file processing, e.g., by the FederalReserve. This fills an ACH-file 304 in CTX format with addendums. A step306 represents a bank's ACH processing, e.g., PepPlus. “Dollars” arethen transferred to an account posting file 308 and contribute to adaily cash reconciliation report 310. A paper reconciliation status 312is output. “Data” is transferred from the step 306 to an EDI file 314from the CTX addenda. An in-house EDI conversion step 316, e.g.,Sterling, is used to provide a control report 318 and a flat file 320. Aflat-file to lockbox format conversion step 322 produces a lockbox file324. Such is transmitted in a step 326 to a loan-data file 328. Aserving system step 330 produces a loan-master file 332 and a generalledger book entry file 334. The daily cash reconciliation step 310combines information from both the account posting file 308 and thegeneral ledger file 334.

[0047] In general, embodiments of the present invention comprise abill-paying system with a customer deposit account that receivesperiodic payroll deposits of an individual or a couple. A bill-payingservice enrolls the individual or couple for a fee, and is authorized totransfer money from the deposit account to the accounts of variouscreditors. An originating depository financial institution, such as abank, actually handles all the transfers of money, and such transfersare preferably all done electronically. The ACH-network supports suchelectronic money transfers. The various bills and debts of theindividual or couple come due at times that are asynchronous to theirincome structure. The bill-paying service is authorized to debit thedeposit account for more than the basic minimums due all the creditorseach month. Such excess is used to accelerate the repayment of variousloans and debts according to what particular application at that timewill have the greatest long-term beneficial effect.

[0048] The ACH-network is based on a series of agreements-between thecompany and its financial institutions, between trading partners,between the employer and its employees/retirees, between the billingcompany and its customers, among financial institutions, and between thefinancial institution and its customers. The basis for these agreementsis the ACH rules: a complete guide to the rules &regulations governingthe ACH-network. These rules and operating guidelines are developed andpromulgated by the national automated clearing house association(NACHA). Rules and conventions for specific applications such ascross-border payments, financial EDI, electronic benefits transfers(EBT), electronic check, and consumer-initiated bill payments aredeveloped by NACHA's councils: the cross-border council, the bankers EDIcouncil, the EBT council, the electronic check council, the bill paymentcouncil, and the Internet council.

[0049] In order to participate in electronic payments, businesses mustenter into agreements with the originating financial institutions oftheir choice and with the receivers of the transactions, e.g.,employees, retirees, consumers, or other businesses. These agreementsdefine the rights and responsibilities of each party to the transaction.The agreement between the business and the financial institution alsoestablishes the method and procedures by which the payments areprocessed and settled.

[0050] The authorization by the receiver generally includes provision ofa financial institution name and routing number and the appropriateaccount number for the transactions. According to a preapprovedschedule, the business submits computer files usually in the ACHstandard format to its ODFI for processing. ACH software for personalcomputers, local area networks, and mainframe computers is readilyavailable in the marketplace. Even the smallest companies can takeadvantage of the efficiencies of the ACH payments system. In addition,many service bureaus and financial institutions provide a variety ofconversion and computer services to assist businesses. Thisbook-electronic payments review and buyers' guide-contains listings andcontact for the providers of ACH products and services.

[0051] There are currently four ACH payment formats available to meetcompany and business needs for timely disbursements and collections.These are cash concentration or disbursement (CCD), cash concentrationor disbursement plus addenda (CCD+), corporate trade exchange (CTX), andthe soon-to-be obsolete corporate trade payments (CTP). Addenda recordsallow the CCD+, CTP and CTX formats to both electronically transmitpayments and payment-related information in standard formats betweenfinancial institutions.

[0052] The CCD payment format is the only corporate format that is notaccompanied by addenda records. However, a reference number is placed inthe entry detail record so that the payment and remittance advice can bereconciled by the seller (receiver).

[0053] The CCD+ format is the same as the CCD format with the additionof one addenda record. Part of the addenda record contains apayment-related information field in which data segments as defined byASCII x12 or NACHA-endorsed banking conventions are used. This addendarecord allows the transmission of limited remittance information relatedto the payment.

[0054] The CTX format allows a company or business to electronicallytransmit one payment to cover multiple invoices and associatedremittance information. The CTX format allows up to 9,999 addendarecords. For CTX entries, the addenda are linked together with eachsucceeding addenda record carrying the next 80 characters of themessage. The complete ASCII x12 820 or 835 transaction set is“enveloped” within the CTX addenda records.

[0055]FIG. 4 is a block diagram of a debt repayment system. In suchsystem a sponsor 10 may have a plurality of marketing contracts 12 whichare under supervision of a trust arrangement 13. The trust arrangementis used to move money as set forth on FIG. 2 (200). In FIG. 4, a W isused to represent the four legs of money movement shown in FIG. 2. Incontrast to the prior art arrangement, a key element of the invention isthat each leg of the W moves money independently of each other leg.Thus, the invention can route money along each leg of the W as desired.Unlike the prior art, the invention therefore provides the asynchronousmovement of money pursuant to a trust arrangement.

[0056] Continuing with the conversation of FIG. 4, a subscription 11 isestablished for a subscriber 15. The subscription may have one or morereceipt schedules 16. The subscription also includes one or moredisbursement schedules 20 and one or more account policies 20. Thedisbursement schedules and account policies bear a one to onerelationship. That is, an account policy may only have a singledisbursement schedule and a disbursement schedule may only be associatedwith a single account policy. The subscription may also include aplurality of subscription transactions 18 as established through queue17. Each subscription transaction may include a corresponding bankaccount transaction 19.

[0057]FIG. 5 is a block diagram of a debt repayment system according tothe invention. It should be noted at the outset that key architecturalimprovements are provided over the system shown on FIG. 4. Among thefeatures of the preferred embodiment of the invention are:

[0058] 1. Each subscriber may be associated with multiple transactionsinvolving the movement of money;

[0059] 2. A single subscription transaction table is provided whichcontains all data for moving money;

[0060] 3. A subscriber can have one physical loan with multiplerecurring payment records, i.e. there is a logical grouping ofdisbursements for a given instrument;

[0061] 4. A trust finder function provides a join across multiple tablesfor trust arrangements to map money movements; and

[0062] 5. A campaign product is provided for managing money based uponproduct type and destination of funds.

[0063] The foregoing features of the invention provide flexibility toallow movement of money independently along each leg of the money path,i.e. the “W” of FIG. 2. However, unlike the prior art, the foregoingadvantages are provided by the invention. Limitations of the prior artreside in the fact that a customer has a single subscription with asingle balance to a single custody account. Thus in the prior art, onemoney movement pattern per customer. The invention, however, providesmultiple money movement patterns per customer. Thus, multiple productsmay be provided with different characteristics, i.e. some may payinterest while others may not pay interest. Thus, a single customer maybe provided with a mortgage acceleration product that does pay interestand a credit card restructure product that does not pay interest.

[0064] As shown on. FIG. 5, a sponsor 10 may have many subscriptions 30.Each subscription can include a plurality of receipt schedules 31. Eachsubscription may also include a plurality of subscription transactions34. Additionally, with regard to a subscription 30 a plurality ofsubscribers 35 may be associated with a subscription. In contrast to theprior art, in which a subscription transactions includes a single bankaccount transaction, the invention provides a single subscriptiontransaction table which contains all data for moving money. Sucharrangement is efficient and reliable in that all information iscontained in one location in contrast to the many locations required bythe prior art.

[0065] As further mentioned above, a one-to-many subscriber arrangementis provided by the invention. Thus, all money transactions for asubscriber are maintained in a single file.

[0066] The invention also provides a plurality of account policies 36for a subscription, each of which may have a plurality of disbursementschedules 37. This aspect of the invention provides a logical groupingof disbursements for a given instrument which stores and organizes datamore efficiently.

[0067] The invention also provides a trust finder function 38 which, inthe preferred embodiment of the invention, includes tables for a sponsor39, product 40, payee 41, and investor 42. The trust finder provides ajoin across the four tables which defines the trust arrangement in sucha way to map money movements. Thus, additional attributes may beprovided to define the money movement process. Such definition iscrested by the join across the four tables.

[0068] The invention also provides a campaign product feature by which acampaign 33 may be offered to a plurality of subscriptions. Eachcampaign, in turn, may comprise a plurality of products 32. Thisarrangement allows the management of money based on product type wheremoney is being remitted. Thus, a product may be sold among multiplecampaigns.

[0069]FIG. 6 represents a create ACH-file process 400 that runs throughthe subscription transaction records and the trust arrangement prenotequeue records that require NACHA processing. Process 400 creates anASCII file of bank transaction instructions. An ASCII file is generatedfor each ODFI bank and appropriate sponsor combination included in thesystem. Upon successful creation of the each ASCII file, the status ofthe associated subscription transaction or trust arrangement prenotequeue changes. The process displays a message box in a step 401 to askif the user wishes to create an ACH file. If the user chooses to cancelthe process, the process is aborted. Otherwise, the process 400 createsa task record in a step 402. In a step 403, the process selects allsubscription transaction and trust arrangement prenote queue recordsthat require NACHA processing. It sorts the transactions by sponsorgrouping requirements, ODFI transit routing number, transaction date,queue type, ODFI account number, RCVG transit routing number, RCVGaccount number and NACHA transaction code. An end-of-file test 404checks to see if all the transactions have been processed. If so, a step405 updates the task record and logs any errors. A step 406 retrieves aNACHA File ID and the bank information. A step 407 sorts out each groupof transactions that have the same sponsor grouping requirement and ODFItransit routing number. A NACHA File header record is created in a step408. A test 409 checks to see if this is the end of a group or andend-of-file. If not, processing continues on to process 500 (FIG. 5)through a connector 410. A step 411 creates a NACHA file control record.A test 412 checks if the total number of records in an ASCII file isdivisible by ten. If not, a step 413 creates filler records to bring thecount of records up to a multiple of ten. A test 414 looks to see if anyerrors have occurred. If not, a step 415 updates an addenda count in aNACHA ASCII file 416. A step 417 closes the NACHA ASCII file 416 andthen commits the transaction updates The step 405 updates a task file418 and task-error file 419. An exit 420 ends the process.

[0070]FIG. 7 represents a process 500. A connector 501 continues fromconnector 410 (FIG. 4). In a step 502, for each group of transactionsthat have the same transaction date, the process creates a NACHA batchheader record. A test 504 checks to see if this is the end of a group.In a step 505, for each group of transactions that have the same ODFIaccount number a test 506 checks for the end of the group. If yes, astep 507 builds an offsetting record and returns to test 504. If test506 is no, then a group of transactions that have the same RCVG bankaccount, NACHA trans code and queue type are assembled. If this is theend of such a group, then a test 509 returns control back to test 506.Otherwise, a step 510 is used to determine the NACHA trans code. If theanswer in test .504 was yes, the a step 511 creates an offsetting entryrecord and batch control record. Control is returned through a connector512 back to process 400.

[0071] A test 513 checks to see if the transaction's queue type is “EFTDSB.” If so, a step 514 divides the set of transactions having the sameRCVG transit routing number, RCVG account number and NACHA transactioncode into groups of five hundred transactions or less. A test 515 checksif all such groups of five hundred or less transactions have beenprocessed. A step 516 and 517 creates a NACHA detail record in CTXformat. A test 518 checks if all the transactions in a group have beenprocessed. Each transaction included in the NACHA detail record is usedin a step 519 to create a set of NACHA CTX addenda records formatted bythe payee's EDI element records. If the answer in test 513 is no, then astep 520 creates a NACHA detail record in PPL format. A step 521 updatesthe status of each subscription transaction or trust arrangement prenotein a queue 522 to “cleared” or “pending”. (Pending status only appliesto prenote and receipt transactions.)

[0072]FIG. 8 represents a generate receipts/disbursements process 600that runs through active subscriptions, and generates subscriptiontransactions for each active receipt schedule or disbursement schedulethat is scheduled to cycle. A step 601 displays a message box to ask ifthe user wishes to generate receipts and disbursements. If the userinstead chooses to cancel the process, the process is aborted. A step602 creates a task record in a task file 603. Each active subscriptionthat is associated with either an active disbursement schedule or anactive receipt schedule that has a next cycle initiate date that is lessthan or equal to the current system date is fetched by a step 604 from asubscription file 605. The subscriptions are sorted by the trustarrangement. A test 606 looks for an end-of-record. If not, a step 607retrieves records associated with the subscription from a subscriberfile 608, a marketing contract file 609, an administrator file 610, anda trust arrangement file 611. A test 612 validates the recordsassociated with the subscription to see if there is an authorizedmarketing contract that it is active prior to or on the current systemtime. This is done by looking in an authorized marketing contract file613. A test 614 verifies that the particular bank account, or receiptaccount specified by the subscriber trust arrangement, is active. A test615 checks to see if the holding account specified by the subscribertrust arrangement is active and the bank account status is cleared. Abank-account-status file 616 and a bank-account file 617 are consulted.A test 618 checks to see if the service fee account specified by thesubscriber trust arrangement is active and the bank account status iscleared. A test 619 checks to see if the EFT disbursement accountspecified by the subscriber trust arrangement is active.

[0073] When all of the records associated with a subscription passvalidation, e.g., tests 614, 615, 618, and 619, control passes toprocess 700 through a connector 620. If the end-of-file is encounteredin test 606, a step 621 updates the task file 603. Process 600 then endsat an exit 622. If any of the records associated with a subscriptionfail validation, e.g., tests 614, 615, 618, and 619, control passes tostep 623 that logs the error in a task-error file 624.

[0074]FIG. 9 represents a stage 2 process 700. A connector 701 receivescontrol from connector 620 in process 600. Each receipt schedule thatneeds processing passes through a step 702. A test 703 looks for anend-of-file marker in the file. If one is found, control passes througha connector 704 to a process 800. A test 705 sees if the schedules'associated bank account status 706, the subscriber account specified bythe receipt schedule, has passed the prenote process and the schedulealso has a receipt method code of EFT. A step 707 creates thetransaction records that are associated with the retrieval of thereceipt funds from the subscriber's account to the receipt account. Astep 708 creates the transaction records that are associated with themovement of the receipt base amount from the receipt account to theholding account. A step 709 creates the transaction records that areassociated with the movement of the receipt service fee amount from theholding account to the service fee account. A step 710 cycles thereceipt schedule. A step 711 logs an SX change record for each activedisbursement schedule associated with the subscription that has a payeerequiring notification. The log is maintained in a disbursement schedulefile 712. A step 713 updates the subscriptions current balance with thereceipt amount and changes the subscription transaction next number in asubscription file 714. A test 715 checks if the process is working onits first receipt schedule for this subscription. If yes, then a step716 allocates a curtailment to the subscriber disbursement schedules. Ifthe schedules associated bank account status (subscriber) has not passedthe prenote process, or the schedule does not have a receipt method codeof EFT, then the process skips the receipt schedule and processes thenext schedule.

[0075]FIG. 10 represents a process 800 that is entered through aconnector 801 from connector 704 in process 700. Each disbursementschedule that needs to be processed passes through a step 802. A test803 looks for an end-of-file marker in the file. If one is found,control passes through a connector 804 to the process 600. Otherwise, asubroutine call 805 is made to process 900. A return is made to a test806 which looks to see if the disbursement is delayed in process 900. Ifnot, a test 807 checks if the payment transaction method is to beelectronic funds transfer (EFT) or by check (CHK). If CHK, then a step808 creates the transaction records that are associated with themovement of the disbursement amount from the holding account to thecheck disbursement account. A step 809 creates the transaction recordsthat are associated with the creation of the corresponding check. If thepayment transaction method is by electronic funds transfer, a step 810creates the transaction records that are related with the movement ofthe disbursement amount from the holding account to the EFT disbursementaccount. A step 811 creates the transaction records that are associatedwith the payment of the disbursement amount to the payee. A step 812cycles the disbursement schedule. A step 813 produces a SX changerecord. A step 814 produces a series of appropriate service events in afile 815. A step 816 updates the subscriber current balance, fundsdisbursed, and “next” numbers. Such updates are sent to adisbursement-schedule file 817 and a subscription file 818.

[0076]FIG. 11 represents a process 900 that is entered through aconnector 901. A test 902 checks to see if the payee is authorizedaccording to a payee list in a file 903. If so, a test 904 checks to seeif the scheduled funds are disbursed, will the subscriber availablecurrent balance remain above zero? (E.g., available currentbalance=SUBN.CURRENT_BALANCE_AMT−(SUBN.PENDING_RCPT+SUBN.HOLD_AMT)) Asubscription file 905 provides data for the calculation. If yes, a test906 looks to see if this is the last cycle the disbursement schedule isbeing processed. If yes, a test 907 checks if there any pendingtransactions. A pending-return file 908, a pending-refund file 909, anda parameter-detail file 910 provide data for test 907. If the answer totest 907 is no, a test 911 checks if the refund system is active. Ifnot, a step 912 estimates all unallocated interest and updates thesubscription file to include new interest and decreases the subscriberminimum allowable balance to zero.

[0077] Each unpaid service fee passes through a step 913. A test 914looks for an end-of-file. If not the EOF, a test 915 sees if there areany unpaid service fees associated with the subscription that have anamount that is less than or equal to the disbursement schedulecurtailment amount and the process determines that it can pay the fee.If unpaid service fees can now be paid, a step 916 creates transactionrecords to withdrawn such service fees from the subscriber holdingaccount. A step 917 creates the transaction records that are associatedwith the deposit of the service fee amount into the service fee account.A step 918 moves the unpaid service fee record in a file 919 to the paidservice fee table and changes the status to “paid” in a file 920. Theservice fee amount is removed from the subscriber current balance,pending curtailment amount, and pending use amount.

[0078] If the EOF is reached in test 914, a test 921 checks to see ifthe curtailment can be disbursed. If so, a step 922 removes the servicefee amount from the disbursement schedule's pending curtailment amount.In a step 923, if there are any unpaid service fees associated with thesubscription that have an amount that is less than or equal to thedisbursement schedule curtailment amount, and the process determinesthat the only thing stopping the payment of the unpaid service fee isthe pending receipts, the disbursement is delayed until the next cycle.A step 924 logs any errors in a file 925.

[0079] Embodiments of the present invention further include an allocatecurtailment program, a calculate-next-cycle dates program, acreate-transaction program, an estimate-interest program, aget-schedule-status program, and a log-SX-change program. Anext-cycle-dates calculation tests to see if the disbursement scheduleis being delayed one business day. If so, thedisbursement_schedule.next_initiate_date is incremented by one businessday and is verified by a calendar table. Thedisbursement_schedule.next_transaction_date is incremented by onebusiness day. And if the disbursement_schedule.next_ideal_date is olderthan five days, the process logs an error into a task-error table.Otherwise the process cycles the receipt or disbursement scheduleaccording to the schedule's cycle type.

[0080] For the last cycle calculation, if all of the disbursementschedules associated with the subscription are closed except for thedisbursement schedule that is currently being processed, and thedisbursement schedule that is currently being processed will not cycleagain prior to its end date, the projected disbursement schedule's nextinitiate date, then the subscription is on its last cycle.

[0081] For the fee payment calculation, if the unpaid service fee amountis less than or equal to the disbursement schedule's pending curtailmentamount, the unpaid service fee can be paid if the payment of the unpaidservice fee would not decrease the subscriber current balance below thesubscriber minimum balance allowed, while also subtracting thesubscriber pending receipt amount. Or if the payment of the unpaidservice fee would not decrease the subscriber current balance below thesubscriber minimum balance allowed, but requires the use of thesubscriber pending receipt amount, the unpaid service fee can be paid,if the disbursement schedule was delayed until the pending receiptamount cleared. Otherwise, the unpaid service fee cannot be paid.

[0082] For the curtailment payment calculation, if the disbursementschedule is capable of curtailing money and its curtailment amount isgreater than its minimum, the curtailment amount can be included in thedisbursement if the payment of the curtailment amount does not decreasethe subscriber current balance below the subscriber minimum balanceallowed, while also subtracting the subscriber pending receipt amount.Or if the payment of the curtailment amount does not decrease thesubscriber current balance below the subscriber minimum balance allowed,but requires the use of the subscriber pending receipt amount, thecurtailment amount could be included in the disbursement, if thedisbursement schedule was delayed until the pending receipt amountcleared. Otherwise, the curtailment amount cannot be disbursed.

[0083] For the create service event, if the sponsor associated with thesubscription requires the creation of an initial enrollment serviceevent at the time of the first disbursement and the current disbursementschedule is the subscriber primary disbursement schedule and it is onits first cycle, and if the subscription has enrollment fees that areunpaid, the process produces an “enpart” service event. Otherwise, theprocess produces an “enfull” service event. If the subscriber primarydisbursement schedule is being processed, the process creates a“dsbfamt” service event. Otherwise, the process creates a “dsbsamt”service event. If an enrollment service fee was paid during theprocessing of the current disbursement schedule, the process creates an“endfrd” service event.

[0084] An allocate-curtailment program assigns portions of a specifiedsubscriber calculated future minimum balance to each of the associateddisbursement schedules that are active and have been configured toreceive curtailment. The calculate next-cycle-dates calculates cycledates given the transaction type, cycle type code, clearing delay, lastideal date and special parameters for semi-monthly loans. Thecreate-transaction program creates the necessary transactions forsubscription activity, including subscription transactions, subscriptionbank account business month and bank account business month records. Theestimate interest program estimates interest that has not been allocatedin the past for a specified subscription. The process stores theestimated amounts in the appropriate subscriber bank account bus month(“sbabm”) tables and loans the total estimated interest amount to thesubscription from the service fee account. Thesubscriber-valid-business-months are all months that fall between thesubscriber start date and the subscriber closed date, or the currentdate, whichever is earliest. The get schedule status program is used todetermine the status of a single receipt or disbursement schedule. Theprogram returns “active”, inactive”, “post active” or “suspend” as thecurrent status, based on the values of the request, start date, enddate, next cycle ideal date and suspend days. The log SX change createsan SX record for a specified disbursement schedule if the payee requiresnotification.

[0085] Although the invention is described herein with reference to thepreferred embodiment, one skilled in the art will readily appreciatethat other applications may be substituted for those set forth hereinwithout departing from the spirit and scope of the present invention.Accordingly, the invention should only be limited by the claims includedbelow.

1. A bill-paying system, comprising: a designated deposit account orsavings account (DDA) belonging to a debtor that is periodicallycredited with a payroll income on a first regular schedule; a custodyaccount belonging to a service provider that is credited with debits tothe DDA by an originating depository financial institution (ODFI); acreditor account belonging to a creditor of said debtor that is creditedon a periodic basis with a payment debit to the custody account on asecond regular schedule; and a mechanism for determining an amount anddate that said ODFI is instructed to transfer funds between the DDA,custody account, and creditor account; and at least one of: a trustfinder mechanism; a campaign product; a subscription transaction table;one or more account policies, each account policy having one or moredisbursement schedules; one or more subscriptions to which a debtor maysubscribe.
 2. The bill-paying system of claim 1, further comprising: anACH-file for providing funds transfer instructions to said ODFI that isgenerated by the mechanism.
 3. The bill-paying system of claim 1,wherein: the DDA receives said payroll income over time that is inexcess of a particular debt owed by said debtor to said creditor; andthe mechanism further provides for a computation of an acceleratedpayment of said debt and an inclusion of an excess payment to saidcreditor account for providing a reduction in a total finance chargeearned by said creditor and costed to said debtor.
 4. The bill-payingsystem of claim 1, further comprising: a service fee account forreceiving a service fee from the DDA in payment of a contract betweenservice provider and said debtor, wherein said service provider operatesthe mechanism.
 5. The bill-paying system of claim 4, further comprising:a curtailment process for providing a computation of any funds that maybe available in the custody account after the creditor account would becredited with said payment debit, and for providing a transfer of saidservice fee to said service fee account.
 6. A bill-paying system,comprising: a designated deposit account and savings account (DDA)belonging to a debtor that is periodically credited with a payrollincome on a first regular schedule; a custody account belonging to aservice provider that is credited with debits to the DDA by anoriginating depository financial institution (ODFI); a plurality ofcreditor accounts each belonging to a particular independent creditor ofsaid debtor that is credited on a periodic basis with a payment debit tothe custody account on a corresponding plurality of second regularschedules; and a mechanism for determining an amount and date that saidODFI is instructed to transfer funds between the DDA, custody account,and each of the plurality of creditor account; and at least one of: atrust finder mechanism; a campaign product; a subscription transactiontable; one or more account policies, each account policy having one ormore disbursement schedules; one or more subscriptions to which a debtormay subscribe.
 7. The bill-paying system of claim 6, further comprising:an ACH-file for providing funds transfer instructions to said ODFI thatis generated by the mechanism on a cyclic basis.
 8. The bill-payingsystem of claim 6, wherein: the DDA receives said payroll income overtime that is in excess of a particular debt owed by said debtor to saidcreditor; and the mechanism further provides for a computation of anaccelerated payment of said debt and an inclusion of an excess paymentto said creditor account for providing a reduction in a total financecharge earned by said creditor and costed to said debtor.
 9. Thebill-paying system of claim 6, further comprising: a service fee accountfor receiving a service fee from the DDA in payment of a contractbetween service provider and said debtor, wherein said service provideroperates the mechanism.
 10. The bill-paying system of claim 9, furthercomprising: a curtailment process for providing a computation of anyfunds that may be available in the custody account after each respectivecreditor account would be credited with said payment debit, and forproviding a transfer of said service fee to said service fee account.11. A bill-paying system, comprising: a plurality of designated depositaccounts (DDA's) each belonging to a corresponding debtor that isperiodically credited with a respective payroll income on a plurality offirst regular schedules; a custody account belonging to a serviceprovider that is credited with debits to the DDA by an originatingdepository financial institution (ODFI); a plurality of creditoraccounts and/or savings accounts each belonging to a particularindependent creditor of each corresponding said debtor that are creditedon a periodic basis with a plurality of payment debits to the custodyaccount on a corresponding plurality of second regular schedules; amechanism for determining an amount and date that said ODFI isinstructed to transfer funds between each of the plurality of DDA's,custody account, and each of the plurality of creditor account; and atleast one of: a trust finder mechanism; a campaign product; asubscription transaction table; one or more account policies, eachaccount policy having one or more disbursement schedules; one or moresubscriptions to which a debtor may subscribe.
 12. The bill-payingsystem of claim 11, further comprising: an ACH-file for providing fundstransfer instructions to said ODFI that is generated by the mechanism ona cyclic basis.
 13. The bill-paying system of claim 11, wherein: each ofthe plurality of DDA's receive said respective payroll income over timethat is in excess of a particular debt owed by a corresponding debtor toa corresponding creditor; and the mechanism further provides for acomputation of an accelerated payment of said debt and an inclusion ofan excess payment to said creditor account for providing a reduction ina total finance charge earned by said creditor and costed to saiddebtor.
 14. The bill-paying system of claim 11, further comprising: aservice fee account for receiving a service fee from the DDA in paymentof a contract between service provider and each said debtor, whereinsaid service provider operates the mechanism.
 15. The bill-paying systemof claim 14, further comprising: a curtailment process for providing acomputation of any funds that may be available in the custody accountafter each respective creditor account would be credited with saidpayment debit, and for providing a transfer of said service fee to saidservice fee account.
 16. A bill-paying service method, comprising thesteps of: enrolling a subscriber who is a debtor to a creditor and whohas authorized debits to be taken from a designated deposit account(DDA) that is periodically credited with a payroll income on a firstregular schedule; periodically debiting said DDA through a transmissionof an ACH-file to an originating depository financial institution (ODFI)and using any funds obtained to credit a custody account; charging aservice fee to said subscriber by debiting said custody account; payingsaid creditor on behalf of said debtor in an amount calculated for anaccelerated repayment of a debt.
 17. The bill-paying service method ofclaim 16, further comprising the steps of: collecting an enrollment feefrom said debtor for an on-going service that includes the step ofpaying said creditor.
 18. The bill-paying service method of claim 16,wherein: the step of periodically debiting said DDA coincides with saidfirst regular schedule; and the step of paying said creditor coincideswith a second regular schedule that differs from said first regularschedule, and such a difference in said first and second regularschedules provides for said accelerated repayment.
 19. A bill-payingservice method, comprising the steps of: enrolling a subscriber who is adebtor to a creditor and who has authorized debits to be taken from adesignated deposit account or savings account (DDA); collecting anenrollment fee from said debtor for an on-going service of paying saidcreditor; depositing a payroll income on a first regular schedule tosaid DDA that is over time in excess of a minimum payment on a debt owedby said debtor to said creditor; periodically debiting said DDA of afirst regular schedule and using any funds obtained to credit a custodyaccount; charging a service fee to said subscriber by debiting saidcustody account; and paying said creditor on behalf of said debtor in anamount calculated for an accelerated repayment of a debt on a secondregular schedule that differs from said first regular schedule, and sucha difference in said first and second regular schedules provides forsaid accelerated repayment; and providing and at least one of: a trustfinder mechanism; a campaign product; a subscription transaction table;one or more account policies, each account policy having one or moredisbursement schedules; one or more subscriptions to which a debtor maysubscribe.
 20. The bill-paying service method of claim 19, wherein: thestep of periodically debiting, the step of charging a service fee, andthe step of paying said creditor each are implemented by a series oftransmissions of ACH-files to an originating depository financialinstitution (ODFI) that has access to said DDA, service fee account, andcustody account, and that can forward funds to said creditor.